Investment products

As PPP enters forgiveness phase, some banks see outsourcing as best move; after the Fed’s stress tests, Wells Fargo to cut dividend while other big banks boost capital buffer; Supreme Court strikes down CFPB leadership structure; and more from this week’s most-read stories.

The class A notes, secured by legacy trust-preferreds and subordinated debt of institutions, carry an investment-grade A1 rating from Moody's. That rating is slightly lower than a prior Hildene CDO, due to elevated pandemic risk to bank profitability.

While elevated loan-loss provisions are expected to eat into all banks’ earnings, midsize banks could suffer more than their big-bank rivals because they have fewer revenue drivers. Meanwhile, investors will be watching closely for any signs of dividend cuts stemming from the Federal Reserve’s caps on payouts.

The Main Street Lending Program is off to a slow start, while the PPP is extended five weeks to distribute the remaining $130 billion in loans; the European regulator is softening its stance to allow more deals.

Supreme Court says the president has the power to remove the director at will; the bank is the only one of the six largest U.S. banks to say it will cut its dividend next quarter.

Wells Fargo customers targeted with phishing attacks using calendar invites; Fed freezes stock buybacks, caps dividends after stress test results; Citigroup names Titi Cole its head of global operations and fraud prevention.

The Fed stopped short of banning payouts entirely following bank stress tests; banks get greater freedom to invest in venture capital funds and reduced collateral on swap trades.

Five financial regulatory agencies clarified the meaning of "covered funds" under the Volcker Rule. Meanwhile, the FDIC gave certain banks more flexibility in interaffiliate exchanges of swaps and adopted a workaround of a court decision governing interest rates on loans sold across state lines.

Markus Braun turned himself in to Munich prosecutors, who arrested him on suspicion of false accounting and market manipulation; the Wirecard fallout may make it harder for European fintechs to attract investors.

The company, which has yet to turn a profit since it was spun off from Live Oak Bank, said it would use the proceeds for working capital and possibly to make acquisitions.